QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2017

or

☐

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from
to
.

Commission File Number 001-10932

WisdomTree Investments, Inc.

(Exact name of registrant as specified in its charter)

Delaware

13-3487784

(State or other jurisdiction of

incorporation or organization)

(IRS Employer

Identification No.)

245 Park Avenue, 35th Floor

New York, New York

10167

(Address of principal executive officers)

(Zip Code)

212-801-2080

(Registrants Telephone Number, Including Area Code)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934, as amended (the Exchange Act) during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements
for the past 90 days. Yes ☒ No ☐

Indicate by check mark
whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T
(§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). ☒ Yes ☐ No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a
non-accelerated filer or a smaller reporting company. See definitions of large accelerated filer, accelerated filer and smaller reporting company in Rule 12b-2 of the Exchange Act.

Large accelerated filer

☒

Accelerated filer

☐

Non-accelerated filer

☐

Smaller reporting company

☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933
(§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ☐

If
an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange
Act. ☐

As of April 27, 2017, there were 136,610,528 shares of the registrants Common Stock, $0.01 par value
per share, outstanding.

This Quarterly Report on Form 10-Q contains forward-looking statements that are based on our
managements beliefs and assumptions and on information currently available to our management. Although we believe that the expectations reflected in these forward-looking statements are reasonable, these statements relate to future events or
our future financial performance, and involve known and unknown risks, uncertainties and other factors that may cause our actual results, levels of activity, performance or achievements to be materially different from any future results, levels of
activity, performance or achievements expressed or implied by these forward-looking statements.

In some cases, you can identify
forward-looking statements by terminology such as may, will, should, expects, intends, plans, anticipates, believes, estimates,
predicts, potential, continue or the negative of these terms or other comparable terminology. These statements are only predictions. You should not place undue reliance on forward-looking statements because they
involve known and unknown risks, uncertainties and other factors, which are, in some cases, beyond our control and which could materially affect results. Factors that may cause actual results to differ materially from current expectations include,
among other things, those listed in the section entitled Risk Factors included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2016. If one or more of these or other
risks or uncertainties occur, or if our underlying assumptions prove to be incorrect, actual events or results may vary significantly from those implied or projected by the forward-looking statements. No forward-looking statement is a guarantee of
future performance. You should read this Report and the documents that we reference in this Report and have filed with the Securities and Exchange Commission, or the SEC, as exhibits to this Report, completely and with the understanding that our
actual future results may be materially different from any future results expressed or implied by these forward-looking statements.

In
particular, forward-looking statements in this Report may include statements about:



anticipated trends, conditions and investor sentiment in the global markets and exchange traded products, or ETPs, which include exchange traded funds, or ETFs;



anticipated levels of inflows into and outflows out of our ETPs;



our ability to deliver favorable rates of return to investors;



our ability to develop new products and services;



our ability to maintain current vendors or find new vendors to provide services to us at favorable costs;



our ability to successfully expand our business into non-U.S. markets;



competition in our business; and



the effect of laws and regulations that apply to our business.

The forward-looking statements
in this Report represent our views as of the date of this Report. We anticipate that subsequent events and developments may cause our views to change. However, while we may elect to update these forward-looking statements at some point in the
future, we have no current intention of doing so except to the extent required by applicable law. Therefore, these forward-looking statements do not represent our views as of any date other than the date of this Report.

WisdomTree Investments, Inc., through its global subsidiaries (collectively, WisdomTree or the Company), is an exchange
traded product (ETP) sponsor and asset manager headquartered in New York. WisdomTree offers ETPs covering equity, fixed income, currency, alternative and commodity asset classes. The Company has the following wholly-owned operating
subsidiaries:



WisdomTree Asset Management, Inc. (WTAM) is a New York based investment adviser registered with the SEC providing investment advisory and other management services to the WisdomTree Trust
(WTT) and WisdomTree exchange traded funds (ETFs).



Boost Management Limited (BML) is a Jersey based management company providing investment and other management services to Boost Issuer PLC (BI) and Boost ETPs.



WisdomTree Europe Limited (WisdomTree Europe) is a U.K. based company registered with the Financial Conduct Authority providing management and other services to BML and WisdomTree Management Limited.



WisdomTree Management Limited (WTML) is an Ireland based management company providing investment and other management services to WisdomTree Issuer plc (WTI) and WisdomTree UCITS ETFs.



WisdomTree Japan Inc. (WTJ) is a Japan based company that is registered with Japans Ministry of Finance and serves the institutional market selling U.S. listed WisdomTree ETFs in Japan.



WisdomTree Commodity Services, LLC (WTCS) is a New York based company that serves as the managing owner and commodity pool operator of the WisdomTree Continuous Commodity Index Fund. WTCS is
registered with the Commodity Futures Trading Commission (CFTC) and is a member of the National Futures Association (NFA).

The WisdomTree ETFs are issued in the U.S. by WTT. WTT, a
non-consolidated third party, is a Delaware statutory trust registered with the SEC as an open-end management investment company. The Company has licensed to WTT the use
of certain of its own indexes on an exclusive basis for the WisdomTree ETFs in the U.S. The Boost ETPs are issued by BI. BI, a non-consolidated third party, is a public limited company organized in Ireland.
The WisdomTree UCITS ETFs are issued by WTI. WTI, a non-consolidated third party, is a public limited company organized in Ireland.

The Board of Trustees and Board of Directors of WTT, BI and WTI, respectively, are separate from the Board of Directors of the Company. The
respective Trustees and Directors of WTT, BI and WTI, as applicable, are primarily responsible for overseeing the management and affairs of the WisdomTree ETFs, Boost ETPs and the WisdomTree UCITS ETFs for the benefit of the WisdomTree ETF, Boost
ETP and the WisdomTree UCITS ETF shareholders, respectively, and have contracted with the Company to provide for general management and administration services. The Company, in turn, has contracted with third parties to provide the majority of these
administration services. In addition, certain officers of the Company provide general management services for WTT, BI and WTI.

2. Significant
Accounting Policies

Basis of Presentation

These consolidated financial statements have been prepared in conformity with U.S. generally accepted accounting principles
(GAAP) and in the opinion of management reflect all adjustments, consisting of only normal recurring adjustments, necessary for a fair statement of financial condition, results of operations, and cash flows for the periods presented. The
consolidated financial statements include the accounts of the Companys wholly owned subsidiaries.

All intercompany accounts and
transactions have been eliminated in consolidation. Certain accounts in the prior years consolidated financial statements have been reclassified to conform to the current years consolidated financial statements presentation. These
reclassifications had no effect on the previously reported operating results.

Consolidation

The Company
consolidates entities in which it has a controlling financial interest. The Company determines whether it has a controlling financial interest in an entity by first evaluating whether the entity is a voting interest entity (VOE) or a
variable interest entity (VIE). The usual condition for a controlling financial interest in a VOE is ownership of a majority voting interest. If the Company has a majority voting interest in a VOE, the entity is consolidated. The Company
has a controlling financial interest in a VIE

when the Company has a variable interest that provides it with (i) the power to direct the activities of the VIE that most significantly impact the VIEs economic performance and
(ii) the obligation to absorb losses of the VIE or the right to receive benefits from the VIE that could potentially be significant to the VIE.

The Company had no variable interests in any VIEs at March 31, 2017 and December 31, 2016.

Segment and Geographic Information

The Company operates as an ETP sponsor and asset manager providing investment advisory services in the U.S., Europe, Canada and Japan. These
activities are reported in the Companys U.S. Business and International Business reportable segments. The U.S. Business segment includes the results of the Companys U.S. operations and Japan sales office, which primarily engages in
selling U.S. listed ETFs to Japanese institutions. The results of the Companys European and Canadian operations are reported as the International Business segment.

Revenues are primarily derived in the U.S. and the vast majority of the Companys AUM is currently located in the U.S.

Foreign Currency Translation

Assets and liabilities of subsidiaries whose functional currency is not the U.S. dollar are translated based on the end of period exchange
rates from local currency to U.S. dollars. Results of operations are translated at the average exchange rates in effect during the period.

Use of
Estimates

The preparation of the Companys consolidated financial statements in conformity with U.S. GAAP requires management
to make estimates and assumptions that affect the reported amounts of assets and liabilities as of the balance sheet dates and the reported amounts of revenues and expenses for the periods presented. Actual results could differ materially from those
estimates.

Revenue Recognition

The Company earns investment advisory fees from its ETPs, as well as licensing fees from third parties. ETP advisory fees are based on a
percentage of the ETPs average daily net assets and recognized over the period the related service is provided. Licensing fees are based on a percentage of the average monthly net assets and recognized over the period the related service is
provided.

Depreciation and Amortization

Depreciation is provided for using the straight-line method over the estimated useful lives of the related assets as follows:

Equipment

5 years

Furniture and fixtures

15 years

Leasehold improvements are amortized over the term of their respective leases or service lives of the
improvements, whichever is shorter. Fixed assets are stated at cost less accumulated depreciation and amortization.

Occupancy

The Company accounts for its office lease facilities as operating leases, which may include free rent periods and escalation clauses. The
Company expenses the lease payments associated with operating leases on a straight-line basis over the lease term.

Marketing and Advertising

Advertising costs, including media advertising and production costs, are expensed when incurred.

Cash and Cash Equivalents

The
Company considers all highly liquid investments with an original maturity of 90 days or less at the time of purchase to be classified as cash equivalents.

Accounts Receivable and Allowance for Doubtful Accounts

Accounts receivable are customer and other obligations due under normal trade terms. An allowance for doubtful accounts is not provided since,
in the opinion of management, all accounts receivable recorded are deemed collectible.

The Company performs a review for the impairment of long-lived assets when events or changes in circumstances indicate that the estimated
undiscounted future cash flows expected to be generated by the assets are less than their carrying amounts or when other events occur which may indicate that the carrying amount of an asset may not be recoverable.

Earnings per Share

Basic earnings
per share (EPS) is computed by dividing net income available to common stockholders by the weighted-average number of common shares outstanding for the period. Net income available to common stockholders represents net income of the
Company reduced by an allocation of earnings to participating securities. Unvested share-based payment awards that contain non-forfeitable rights to dividends or dividend equivalents (whether paid or unpaid)
are participating securities and are included in the computation of EPS pursuant to the two-class method. Share-based payment awards that do not contain such rights are not deemed participating securities and
are included in diluted shares outstanding (if dilutive) under the treasury stock method. Diluted EPS reflects the reduction in earnings per share assuming dilutive options or other dilutive contracts to issue common stock were exercised or
converted into common stock. Diluted EPS is calculated under both the treasury stock method and two-class method. The calculation that results in the most dilutive EPS amount for the common stock is reported
in the Companys consolidated financial statements.

Securities owned and securities sold, but not yet purchased are securities classified as either trading or available-for-sale (AFS). These securities are recorded on their trade date and are measured at fair value. The Company classifies these financial instruments based primarily on the Companys
intent to hold or sell the security. Changes in the fair value of securities classified as trading are reported in other income in the period the change occurs. Unrealized gains and losses of securities classified as AFS are included within other
comprehensive income. Once sold, amounts reclassified out of accumulated other comprehensive income and into earnings are determined using the specific identification method. AFS securities are assessed for impairment on a quarterly basis.

Securities Held-to-Maturity

The Company accounts for certain of its investments as
held-to-maturity on a trade date basis, which are recorded at amortized cost. For
held-to-maturity investments, the Company has the intent and ability to hold investments to maturity and it is not
more-likely-than-not that the Company will be required to sell the investments before recovery of their amortized cost bases, which may be maturity. On a quarterly basis, the Company reviews its portfolio of
investments for impairment. If a decline in fair value is deemed to be other-than-temporary, the security is written down to its fair value through earnings.

Investment, Carried at Cost

The
Company accounts for equity securities that do not have a readily determinable fair value as cost method investments to the extent such investments are not subject to consolidation or the equity method. Income is recognized when dividends are
received only to the extent they are distributed from net accumulated earnings of the investee. Otherwise, such distributions are considered returns of investment and are recorded as a reduction of the cost of the investment.

Cost method investments held by the Company are assessed for impairment on a quarterly basis.

Goodwill

Goodwill is the excess
of the fair value of the purchase price over the fair values of the identifiable net assets at the acquisition date. The Company tests its goodwill for impairment at least annually and at the time of a triggering event requiring re-evaluation, if one were to occur. Goodwill may be impaired when the estimated fair value of the reporting unit that was allocated the goodwill is less than its carrying value. If the estimated fair value of such
reporting unit is less than its carrying value, goodwill impairment is recognized if the implied fair value of the reporting units goodwill is less than the carrying amount of that goodwill. A reporting unit is an operating segment or a
component of an operating segment provided that the component constitutes a business for which discrete financial information is available and management regularly reviews the operating results of that component.

For impairment testing purposes, goodwill has been allocated to the Companys U.S. Business reporting unit (See Note 14). The Company has
designated April 30th as its annual goodwill impairment testing date. When performing its goodwill impairment test, the Company considers a qualitative assessment, when appropriate, and the income
approach, market approach and its market capitalization when determining the fair value of its reporting units.

Intangible Assets

Indefinite-lived intangible assets are tested for impairment at least annually and are reviewed for impairment whenever events or changes in
circumstances indicate that the carrying amount of an asset may not be recoverable. Indefinite-lived intangible assets are impaired if their estimated fair values are less than their carrying values.

Finite-lived intangible assets, if any, are amortized over their estimated useful life, which is
the period over which the assets are expected to contribute directly or indirectly to the future cash flows of the Company. These intangible assets are tested for impairment at the time of a triggering event, if one were to occur. Finite-lived
intangible assets may be impaired when the estimated undiscounted future cash flows generated from the assets are less than their carrying amounts.

The Company may rely on a qualitative assessment when performing its intangible asset impairment test. Otherwise, the impairment evaluation is
performed at the lowest level of identifiable cash flows independent of other assets. The Company has designated November 30th as its annual impairment testing date for its indefinite-lived
intangible assets.

Stock-Based Awards

Accounting for stock-based compensation requires the measurement and recognition of compensation expense for all equity awards based on
estimated fair values. Stock-based compensation is measured based on the grant-date fair value of the award and is amortized over the relevant service period.

Income Taxes

The Company accounts
for income taxes using the liability method, which requires the determination of deferred tax assets and liabilities based on the differences between the financial and tax basis of assets and liabilities using the enacted tax rates in effect for the
year in which differences are expected to reverse. Deferred tax assets are adjusted by a valuation allowance if, based on the weight of available evidence, it is more-likely-than-not that some portion or all
the deferred tax assets will not be realized.

In order to recognize and measure any unrecognized tax benefits, management evaluates and
determines whether any of its tax positions are more-likely-than-not to be sustained upon examination, including resolution of any related appeals or litigation processes, based on the technical merits of the
position. Once it is determined that a position meets this recognition threshold, the position is measured to determine the amount of benefit to be recognized in the consolidated financial statements. The Company records interest expense and
penalties related to tax expenses as income tax expense.

Non-income based taxes are recorded as
part of other liabilities and other expenses.

Third Party Sharing Arrangements

The Company pays a percentage of its advisory fee revenues based on incremental growth in AUM, subject to caps or minimums, to marketing agents
to sell WisdomTree ETFs and for including WisdomTree ETFs on third party customer platforms.

Business Combinations and Acquisitions

The Company includes the results of operations of the businesses that it acquires from the respective dates of acquisition. The fair values of
the purchase price of the acquisitions are allocated to the assets acquired and liabilities assumed based on their estimated fair values. The excess of the fair value of purchase price over the fair values of these identifiable assets and
liabilities is recorded as goodwill. The Company may allocate purchase price to identifiable intangible assets. The estimated fair value of identifiable intangible assets is based on critical estimates, judgments and assumptions derived from:
analysis of market conditions; revenue and revenue growth assumptions; profitability assumptions; discount rates; customer retention rates; and estimated useful lives.

Recently Issued Accounting Pronouncements

In June 2016, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2016-13,Financial Instruments-Credit Losses (Topic 326)  Measurement of Credit Losses on Financial Instruments (ASU 2016-13). The main objective of the standard
is to provide financial statement users with more decision-useful information about the expected credit losses on financial instruments and other commitments to extend credit held by a reporting entity at each reporting date. To achieve this
objective, the amendments in the standard replace the incurred loss impairment methodology with a methodology that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information to inform
credit loss estimates. The standard is applicable to loans, accounts receivable, trade receivables, and other financial assets measured at amortized cost, loan commitments and certain other off-balance
sheet credit exposures, debt securities (including those held-to-maturity) and other financial assets measured at fair value through other comprehensive income, and
beneficial interests in securitized financial assets. Accordingly, the new methodology will be utilized when assessing the Companys securities classified as AFS and
held-to-maturity for impairment. ASU 2016-13 is effective for years beginning after December 15, 2019, including interim
periods within those fiscal years under a modified retrospective approach. Early adoption is permitted for periods beginning after December 15, 2018. The Company is currently evaluating the impact that the standard will have on its consolidated
financial statements.

In March 2016, the FASB issued ASU 2016-09,CompensationStock
Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting (ASU 2016-09). The standard is intended to simplify several areas of accounting for share-based compensation arrangements,
including the income tax impact, classification on the statement of cash flows and forfeitures. ASU 2016-09 is effective for fiscal years, and interim periods within those years, beginning after
December 15, 2016, and early adoption is permitted. The Company adopted this standard prospectively on January 1, 2017. The adoption of the standard increased volatility

reported in income tax expense as income tax windfalls and shortfalls associated with the vesting of stock-based compensation is now recorded in income tax expense, rather than additional paid-in capital, when applicable. This new guidance resulted in the Company recognizing approximately $1.0 million of income tax expense for tax shortfalls related to stock-based compensation vesting occurring
during this period, which reduced basic and diluted EPS by $0.01 (See Notes 11 and 12).

In February 2016, the FASB issued ASU 2016-02,Leases (ASU 2016-02), which requires lessees to include most leases on the balance sheet. ASU 2016-02 is effective for
fiscal years (and interim reporting periods within those years) beginning after December 15, 2018 and early adoption is permitted. The Company is currently evaluating the impact that the standard will have on its consolidated financial
statements (See Note 8).

In January 2016, the FASB issued ASU 2016-01,Financial Instruments
 Recognition and Measurement of Financial Assets and Financial Liabilities (ASU 2016-01). The main objective of the standard is to enhance the reporting model for financial instruments to provide
users of financial statements with more decision-useful information. The amendments in the update make targeted improvements to generally accepted accounting principles. These include requiring equity investments (except those accounted for under
the equity method of accounting or those that result in consolidation of the investee) to be measured at fair value with changes in fair value recognized in net income.
Available-for-sale classification for equity investments with readily determinable fair values will no longer be permissible. However, an entity may choose to measure
equity investments that do not have readily determinable fair values at cost minus impairment, if any, plus or minus changes resulting from observable price changes in orderly transactions for the identical or similar investment of the same issuer.
The update also simplifies the impairment assessment of equity investments without readily determinable fair values by requiring a qualitative assessment to identify impairment. When a qualitative assessment indicates that impairment exists, an
entity is required to measure the investment at fair value. ASU 2016-01 is effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. Early adoption
is not permitted for the updates currently applicable to the Company. The Companys equity investments with readily determinable fair values are all currently measured at fair value with changes in fair value recognized in net income. The
Company will apply the amendments in this update when assessing the carrying value of its investment, held at cost.

In May 2014, the FASB
issued ASU 2014-09,Revenue from Contracts with Customers (ASU 2014-09), which is a new comprehensive revenue recognition standard on the financial reporting
requirements for revenue from contracts entered into with customers. In July 2015, the FASB deferred this ASUs effective date by one year, to interim and annual periods beginning after December 15, 2017. The deferral allows early adoption
at the original effective date. During 2016, the FASB issued ASU 2016-08, which clarifies principal versus agent considerations, ASU 2016-10, which clarifies identifying
performance obligations and the licensing implementation guidance, and ASU 2016-12, which amends certain aspects of the new revenue recognition standard pursuant to ASU
2014-09. ASU 2014-09 allows for the use of either the retrospective or modified retrospective adoption method. The Company is currently reviewing its contracts in order
to evaluate the impact that the standard will have on its consolidated financial statements.

3. Cash and Cash Equivalents

Cash and cash equivalents of approximately $39,743 and $56,484 at March 31, 2017 and December 31, 2016, respectively, were held at
one financial institution. At March 31, 2017 and December 31, 2016, cash equivalents were approximately $39,522 and $55,619, respectively.

Securities owned and securities sold, but not yet purchased are measured at fair value. The fair value of securities is defined as the price
that would be received to sell an asset or paid to transfer a liability (i.e., the exit price) in an orderly transaction between market participants at the measurement date. ASC 820, Fair Value Measurements, establishes a
hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs are inputs that market
participants would use in pricing the asset or liability developed based on market data obtained from independent sources. Unobservable inputs reflect assumptions that market participants would use in pricing the asset or liability developed based
on the best information available in the circumstances. The hierarchy is broken down into three levels based on the transparency of inputs as follows:

Level 1



Quoted prices for identical instruments in active markets.

Level 2



Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations whose inputs are observable or whose significant value drivers
are observable.

Level 3



Instruments whose significant drivers are unobservable.

The availability of observable inputs can vary from product to product and is effected by a wide variety
of factors, including, for example, the type of product, whether the product is new and not yet established in the marketplace, and other characteristics particular to the transaction. To the extent that valuation is based on models or inputs
that are less observable or unobservable in the

market, the determination of fair value requires more judgment. Accordingly, the degree of judgment exercised by management in determining fair value is greatest for instruments categorized in
Level 3. In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, for disclosure purposes, the level in the fair value hierarchy within which the fair value
measurement in its entirety falls is determined based on the lowest level input that is significant to the fair value measurement in its entirety.

Fair Valuation Methodology

Cash and Cash Equivalents  These financial assets represent cash in banks or cash invested in highly liquid investments with
original maturities less than 90 days. These investments are valued at par, which approximates fair value, and are considered Level 1 (See Note 3).

Securities (Held-to-Maturity) These securities
are Federal agency debt instruments which are instruments that are generally traded in active, quoted and highly liquid markets and are therefore classified as Level 1 within the fair value hierarchy (See Note 5).

Securities Owned/Sold But Not Yet Purchased  These securities consist of securities classified as trading and AFS, as follows:

March 31,2017

December 31,2016

Securities Owned

Trading securities

$

264

$

1,556

Available-for-sale
securities

57,347

57,351

Total

$

57,611

$

58,907

Securities Sold, but not yet Purchased

Trading securities

$

27

$

1,248

Available-for-sale
securities





Total

$

27

$

1,248

Trading securities are investments in exchange traded funds. These instruments are generally traded in active,
quoted and highly liquid markets and are therefore classified as Level 1 within the fair value hierarchy. AFS securities are investments in short-term investment grade corporate bonds and are classified as Level 2. Fair value is generally
derived from observable bids for these Level 2 financial instruments.

AFS Securities

The following table summarizes unrealized gains, losses and fair value of the AFS securities:

March 31,2017

December 31,2016

Cost

$

57,779

$

57,615

Gross unrealized gains in other comprehensive income





Gross unrealized losses in other comprehensive income

(432

)

(264

)

Fair value

$

57,347

$

57,351

All the Companys AFS securities are due within one year. The Company assesses the AFS securities for
other-than-temporary impairment on a quarterly basis. No AFS securities were determined to be other-than-temporarily impaired at March 31, 2017 or December 31, 2016.

During the three months ended March 31, 2017, the Company received $21.0 million of proceeds from the sale and maturity of available-for-sale securities and recognized gross realized losses of $0.2 million. These losses have been reclassified out of accumulated other comprehensive income and
into other income within the Consolidated Statements of Operations. Proceeds received were used to purchase additional AFS securities.

The following table is a summary of the Companys securities
held-to-maturity:

March 31,2017

December 31,2016

Federal agency debt instruments (amortized cost)

$

23,202

$

22,496

The following table summarizes unrealized gains, losses, and fair value of securities held-to-maturity:

March 31,2017

December 31,2016

Cost/amortized cost

$

23,202

$

22,496

Gross unrealized gains

12

13

Gross unrealized losses

(1,405

)

(1,353

)

Fair value

$

21,809

$

21,156

The Company assesses these securities for other-than-temporary impairment on a quarterly basis. No securities
were determined to be other-than-temporarily impaired at March 31, 2017 or December 31, 2016. The Company does not intend to sell these securities and it is not more likely than not that the Company will be required to sell the securities
before recovery of their amortized cost bases, which may be maturity.

The following table sets forth the maturity profile of the
securities held-to-maturity; however, these securities may be called prior to maturity date:

March 31,2017

December 31,2016

Due within one year

$

3,997

$

3,994

Due one year through five years

1,020

1,023

Due five years through ten years

4,030

4,031

Due over ten years

14,155

13,448

Total

$

23,202

$

22,496

6. Investment, Carried at Cost

On November 18, 2016, the Company made a $20,000 strategic investment in AdvisorEngine, Inc., an end-to-end wealth management platform which enables individual customization of investment philosophies. The Company and AdvisorEngine also entered into an agreement whereby the Companys asset
allocation models are made available through AdvisorEngines open architecture platform and the Company actively introduces the platform to its distribution network.

In consideration of its investment, the Company received 11,811,856 shares of Series A convertible preferred shares (Series A
Preferred), for an aggregate equity ownership interest of approximately 42% (or 36% on a fully-diluted basis).

The Series A
Preferred is convertible into common stock at the option of the Company and contains various rights and protections including a non-cumulative 6.0% dividend, payable if and when declared by the board of
directors, and a liquidation preference that is senior to all other holders of capital stock of AdvisorEngine. The investment is accounted for under the cost method of accounting as it is not considered to be
in-substance common stock.

This investment is assessed for impairment on a quarterly basis. No
impairment existed at March 31, 2017 or December 31, 2016.

The
Company has entered into obligations under operating leases with initial non-cancelable terms in excess of one year for office space, telephone and data services. Expenses recorded under these agreements for
the three months ended March 31, 2017 and 2016 were approximately $1,120 and $985, respectively.

Future minimum lease payments with
respect to non-cancelable operating leases at March 31, 2017 were approximately as follows:

Remainder of 2017

$

3,040

2018

3,437

2019

2,952

2020

2,867

2021 and thereafter

24,079

Total

$

36,375

Letter of Credit

The Company collateralized its U.S. office lease through a standby letter of credit totaling $1,384. The collateral is included in cash and
cash equivalents on the Companys Consolidated Balance Sheets.

Contingencies

The Company may be subject to reviews, inspections and investigations by regulatory authorities as well as legal proceedings arising in the
ordinary course of business. The Company is not currently party to any litigation that is expected to have a material adverse impact on its business, financial position, results of operations or cash flows.

9. Related Party Transactions

The
Companys revenues are derived primarily from investment advisory agreements with related parties. Under these agreements, the Company has licensed to related parties the use of certain of its own indexes for the U.S. and Canadian WisdomTree
ETFs and WisdomTree UCITS ETFs. The Board of Trustees and Board of Directors of the related parties are primarily responsible for overseeing the management and affairs of the U.S. and Canadian WisdomTree ETFs, Boost ETPs and WisdomTree UCITS ETFs
for the benefit of their shareholders and have contracted with the Company to provide for general management and administration services. The Company is also responsible for certain expenses of the related parties, including the cost of transfer
agency, custody, fund administration and accounting, legal, audit, and other non-distribution services, excluding extraordinary expenses, taxes and certain other expenses, which is included in fund management
and administration on the Companys Consolidated Statements of Operations. In exchange, the Company receives fees based on a percentage of the ETF average daily net assets. The advisory agreements may be terminated by the related parties upon
notice. Certain officers of the Company also provide general management oversight of the related parties; however, these officers have no material decision making responsibilities and primarily implement the decisions of the Board of Trustees and
Board of Directors of the related parties.

The following table summarizes accounts receivable from related parties which are included as
a component of Accounts receivable on the Companys Consolidated Balance Sheets:

The following table summarizes revenues from advisory services provided to related parties:

Three Months Ended

March 31,2017

March 31,2016

Advisory services provided to WTT

$

50,456

$

58,642

Advisory services provided to BI and WTI

2,155

1,523

Advisory services provided to WTCS

570

450

Advisory services provided to WTAMC

81



Total

$

53,262

$

60,615

The Company also had an investment in a WisdomTree ETF of approximately $1,300 at December 31, 2016. The
investment was redeemed by the fund which was subsequently closed and liquidated during three months ended March 31, 2017.

10. Stock-Based Awards

The Company grants equity awards to employees and directors which include restricted stock awards, restricted stock units and stock
options. Stock options may be issued for terms of ten years and may vest after at least one year and have an exercise price equal to the Companys stock price on the grant date. Restricted stock awards and restricted stock units are generally
valued based on the Companys stock price on the grant date. The Company estimates the fair value for stock options using the Black-Scholes option pricing model. All restricted stock awards, restricted stock units and stock option awards
require future service as a condition of vesting with certain awards subject to acceleration under certain conditions.

On June 20,
2016, the Companys stockholders approved a new equity award plan under which the Company can issue up to 10,000,000 shares of common stock (less one share for every share granted under prior plans since March 31, 2016 and inclusive of
shares available under the prior plans as of March 31, 2016) in the form of stock options and other stock-based awards. The Company also has issued from time to time stock-based awards outside a plan.

The Company recorded stock-based compensation expense of $3,421 and $3,503 for the three months ended March 31, 2017 and 2016,
respectively.

A summary of unrecognized stock-based compensation expense and average remaining vesting period is as follows:

March 31, 2017

Unrecognized Stock-BasedCompensation

AverageRemainingVesting Period

Employees and directors restricted stock awards

$

22,613

1.93

A summary of stock options, restricted stock and restricted stock unit activity for the three months ended
March 31, 2017 is as follows:

The following is a reconciliation of the basic and diluted earnings per share computation:

Three Months Ended March 31,

2017

2016

Net income

$

6,880

$

12,072

(shares in thousands)

Shares of common stock and common stock equivalents:

Weighted average common shares used in basic computation

134,385

135,467

Dilutive effect of common stock equivalents

1,124

990

Weighted average common shares used in dilutive computation

135,509

136,457

Basic earnings per share

$

0.05

$

0.09

Diluted earnings per share

$

0.05

$

0.09

In the table above, unvested share-based awards that have
non-forfeitable rights to dividends or dividend equivalents are treated as a separate class of securities in calculating EPS.

Diluted earnings per share reflects the reduction in earnings per share assuming options or other contracts to issue common stock were
exercised or converted into common stock (if dilutive) under the treasury stock method. The Company excluded 1,549,440 and 2,017,005 common stock equivalents from its computation of diluted earnings per share for the three months ended
March 31, 2017 and 2016, respectively, as they were determined to be anti-dilutive.

As further discussed in Note 12, the Company
adopted ASU 2016-09 prospectively during the three-months ended March 31, 2017 which had the effect of reducing basic and diluted EPS by $0.01.

12. Income Taxes

Effective Income Tax Rate 
Three Months Ended March 31, 2017 and March 31, 2016

The Companys effective income tax rate for the three months
ended March 31, 2017 of 53.6% resulted in income tax expense of $7.9 million. The Companys tax rate differs from the federal statutory tax rate of 35% primarily due to a valuation allowance on foreign net operating losses, tax
shortfalls associated with the vesting of stock-based compensation awards and state and local income taxes.

Effective January 1,
2017, US GAAP was amended with the intention to simplify the accounting for stock-based compensation. This includes the requirement to record the tax effects related to stock-based compensation within income tax expense, rather than additional paid-in capital, when applicable. Therefore, tax shortfalls (and tax windfalls) associated with the vesting of stock-based compensation awards are now included within income tax expense. This new guidance resulted
in the recognition of $1.0 million of income tax expense associated with tax shortfalls recognized upon vesting of stock-based compensation awards during the quarter.

The Companys effective income tax rate for the three months ended March 31, 2016 of 44.3% resulted in income tax expense of
$9,600. The Companys tax rate differs from the federal statutory tax rate of 35% primarily due to state and local income taxes, the acquisition payment expense (which is non-deductible) and a
valuation allowance on foreign net operating losses.

Net Operating Losses  U.S.

The Companys pre-tax federal net operating losses for tax purposes (NOLs) at
March 31, 2017 was $3,671 which expire in 2024. The net operating loss carryforwards have been reduced by the impact of annual limitations described in the Internal Revenue Code Section 382 that arose as a result of an ownership change.

Net Operating Losses  International

The Companys European and Canadian subsidiaries generated NOLs outside the U.S. These tax effected NOLs were $2.4 million at
March 31, 2017. The Company established a full valuation allowance related to these NOLs as it is more-likely-than-not that some portion, or all, of the deferred tax assets will not be realized.

A summary of the components of the Companys deferred tax asset at March 31, 2017 is as follows:

March 31,2017

December 31,2016

Deferred tax assets:

NOLs  Foreign

$

2,414

$

4,551

Stock-based compensation

2,353

5,382

Deferred rent liability

2,005

2,024

NOLs  U.S.

1,410

1,611

Accrued expenses

1,207

4,552

Unrealized losses

163

101

Other

262

227

Deferred tax assets

9,814

18,448

Deferred tax liabilities:

Fixed assets

2,405

2,405

Incentive compensation

1,023

1,365

Goodwill and intangible assets

376

301

Deferred tax liabilities

3,804

4,071

Total deferred tax assets less deferred tax liabilities

6,010

14,377

Less: valuation allowance

(2,414

)

(4,551

)

Deferred tax assets, net

$

3,596

$

9,826

13. Shares Repurchased

On October 29, 2014, the Companys Board of Directors authorized a three-year share repurchase program of up to $100,000. On
April 27, 2016, the Board of Directors approved a $60,000 increase to the Companys share repurchase program and extended the term through April 27, 2019. Included under this program are purchases to offset future equity grants made
under the Companys equity plans and are made in open market or privately negotiated transactions. This authority may be exercised from time to time and in such amounts as market conditions warrant, and subject to regulatory considerations. The
timing and actual number of shares repurchased depends on a variety of factors including price, corporate and regulatory requirements, market conditions and other corporate liquidity requirements and priorities. The repurchase program may be
suspended or terminated at any time without prior notice. Shares repurchased under this program are returned to the status of authorized and unissued on the Companys books and records.

During the three months ended March 31, 2017 and March 31, 2016, the Company repurchased 346,529 shares and 3,407,305 shares of its
common stock, respectively, under this program for an aggregate cost of $3,628 and $35,555, respectively.

As of March 31, 2017,
$92,877 remains under this program for future purchases.

14. Goodwill and Intangible Assets

Goodwill has been allocated to the Companys U.S. Business reporting unit. The Company has designated April 30th as its annual goodwill impairment testing date. The following table summarizes the goodwill activity during the period:

As part of the GreenHaven acquisition which occurred on January 1, 2016, the Company identified an intangible asset related to its
customary advisory agreement with the GreenHaven Commodities ETF for $9,953. This intangible asset (which is deductible for tax purposes) was determined to have an indefinite useful life. The Company has designated November 30th as its annual impairment testing date for this indefinite-lived intangible asset.

Total

Balance at January 1, 2017

$

9,953

Increases/(decreases)



Balance at March 31, 2017

$

9,953

15. Segment Reporting

The Company operates as an ETP sponsor and asset manager providing investment advisory services in the U.S., Europe, Canada and Japan. These
activities are reported in the Companys U.S. Business and International Business reportable segments. The U.S. Business segment includes the results of the Companys U.S. operations and Japan sales office. The results of the
Companys European and Canadian operations are reported as the International Business segment.

Information concerning these
reportable segments are as follows:

Three Months Ended March 31,

2017

2016

Revenues (U.S. Business segment)

Advisory fees

$

51,026

$

59,092

Other income

1,312

221

Total revenues (U.S. Business segment)

$

52,338

$

59,313

Revenues (International Business segment)

Advisory fees

$

2,236

$

1,523

Other income

25

42

Total revenues (International Business segment)

$

2,261

$

1,565

Total revenues

$

54,599

$

60,878

Income/(loss) before taxes

U.S. Business segment

$

17,908

$

24,210

International Business segment

(3,086

)

(2,538

)

Total income before taxes

$

14,822

$

21,672

Assets are not reported by segment as such information is not utilized by the chief operating decision maker.
The vast majority of the Companys assets are located in the U.S.

16. Subsequent Events

On April 27, 2017, the Company and AdvisorEngine jointly announced their commitment to providing advisor growth solutions through
AdvisorEngines acquisition of Kredible Technologies, Inc., a technology enabled, research-driven practice management firm designed to help advisors acquire new clients. The Company invested an additional $5,000 in AdvisorEngine to help
facilitate the Kredible acquisition and continue to fuel AdvisorEngines growth, leadership and innovation in the advisor solutions space. The Company received 2,646,062 shares of Series A-1 convertible
preferred stock (Series A-1 Preferred) for an aggregate equity ownership interest of approximately 47% (or 41% on a fully-diluted basis). The Series A-1
Preferred has substantially the same terms as the Series A Preferred that the Company received in November 2016 in connection with its initial investment in AdvisorEngine as described in Note 6.

ITEM 2. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS

The following discussion and analysis of our financial condition and results of operations should be read
together with our consolidated financial statements and the related notes and the other financial information included elsewhere in this Report. In addition to historical consolidated financial information, the following discussion contains
forward-looking statements that reflect our plans, estimates and beliefs. Our actual results could differ materially from those discussed in the forward-looking statements. Factors that could cause or contribute to these differences include those
discussed below. For a more complete description of the risks noted above and other risks that could cause our actual results to materially differ from our current expectations, please see Item 1A Risk Factors in our Annual Report
on Form 10-K for the fiscal year ended December 31, 2016. We assume no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or
otherwise, unless required by law.

Executive Summary

Introduction

We were the tenth
largest ETP sponsor in the world (based on AUM), with AUM of $43.4 billion globally as of March 31, 2017. An ETP is a pooled investment vehicle that holds a basket of financial instruments, securities or other assets and generally seeks to
track (index-based) or outperform (actively managed) the performance of a broad or specific equity, fixed income or alternatives market segment, commodity or currency (or an inverse or multiple thereof). ETPs are listed on an exchange with their
shares traded in the secondary market at market prices, generally at approximately the same price as the net asset value of their underlying components. ETP is an umbrella term that includes ETFs, exchange-traded notes and exchange-traded
commodities.

Through our operating subsidiaries, we provide investment advisory and other management services to the WisdomTree ETFs and
Boost ETPs collectively offering ETPs covering equity, fixed income, currency, alternatives and commodity asset classes. In exchange for providing these services, we receive advisory fee revenues based on a percentage of the ETPs average daily
AUM. Our expenses are predominantly related to selling, operating and marketing our ETPs. We have contracted with third parties to provide certain operational services for the ETPs. We distribute our ETPs through all major channels within the asset
management industry, including brokerage firms, registered investment advisers, institutional investors, private wealth managers and discount brokers primarily through our sales force. Our sales efforts are not directed towards the retail segment
but rather are directed towards financial or investment advisers that act as intermediaries between the end-client and us. Recent investments in technology-enabled services including portfolio construction,
asset allocation, practice management services and the AdvisorEngine platform have been made in order to differentiate us in the market, expand our distribution and further enhance our relationships with financial advisors.

A significant portion of our AUM is invested in securities issued outside of the U.S. Therefore, our AUM and revenues are affected by
movements in global capital market levels and the strengthening or weakening of the U.S. dollar against other currencies. As the chart below reflects, as of March 31, 2017, 42% of our U.S. AUM was concentrated in two products with similar
strategies  HEDJ, our European equity ETF which hedges exposure to the Euro, and DXJ, our Japanese equity ETF which hedges exposure to the Yen. The strengthening of the Euro or Yen against the U.S. dollar, or the decline in European or
Japanese equity markets, may have an adverse effect on our results.

During the first quarter of 2017, U.S. market sentiment was favorable as investors focused on the potential for both regulatory and tax reform.
Various economic indicators also continued to strengthen which led to a 25bps U.S. interest rate increase along with speculation that further increases may soon follow. International and emerging markets were also on an upswing supported by positive
economic data.

The S&P 500 rose 6.1%, MSCI EAFE (local currency) rose 4.8% and MSCI Emerging Markets Index (U.S. dollar) rose 11.5%
in the first quarter. In addition, the European equity market appreciated with the MSCI EMU Index rising 7.3% in local currency terms while the Japan equity market as evidenced by the MSCI Japan Index (local currency) was flat for the quarter. Also,
the U.S. dollar weakened 4.8% versus the Yen and 1.3% versus the Euro during the first quarter.

The vast majority of our global AUM is in
U.S. listed ETFs. As the charts below reflect, industry flows for the first quarter of 2017 reached a record of $132.4 billion. U.S. equities and fixed income gathered the majority of those flows.

Source: Investment Company Institute, WisdomTree

Business Segments

We operate as
an ETP sponsor and asset manager providing investment advisory services in the U.S., Europe, Canada and Japan. These activities are reported in our U.S. Business and International Business segments, as follows:



U.S. Business segment: Our U.S. business and Japan sales office, which primarily engages in selling our U.S. listed ETFs to Japanese institutions; and



International Business segment: Our European business which commenced in April 2014 in connection with our acquisition of U.K. based ETP sponsor Boost ETP, LLP (Boost) and our Canadian business which
launched its first six ETFs in July 2016.

Outflows
from our U.S. listed ETFs were muted in the first quarter of 2017. We continued to experience outflows from our European equity ETF (HEDJ), however those outflows were offset by inflows into our Japan equity ETF (DXJ) and our U.S. equity, emerging
markets and international equity ETFs. Our U.S. listed AUM increased from $40.2 billion as of December 31, 2016 to $41.9 billion as of March 31, 2017 primarily due to $1.8 billion of market appreciation.

International Business Segment

Our International ETFs had net inflows of $320.1 million in the first quarter of 2017. This was principally a result of inflows of
$160.3 million into our European listed ETPs and $159.8 million into our UCITS ETFs. Our International AUM increased from $1.1 billion as of December 31, 2016 to $1.4 billion as of March 31, 2017 primarily due to net
inflows and, to a lesser extent, market appreciation.

Revenues  We recorded revenues of $54.6 million in the three months ended March 31, 2017, down 10.3% from the three months ended March 31, 2016 due to declines in our average AUM, primarily
in our two largest ETFs and partly offset by an increase in average AUM resulting from $2.1 billion of net inflows into our U.S. equity ETFs and market appreciation.



Expenses  Total expenses increased 1.5% from the three months ended March 31, 2016 to $39.8 million primarily resulting from higher compensation partly offset by lower professional fees.



Net income  Net income declined 43.0% from the three months ended March 31, 2016 to $6.9 million.

Three Months Ended March 31, 2017 Compared to Three Months Ended March 31, 2016

Overview

Three Months EndedMarch 31,

Change

PercentChange

2017

2016

Global AUM (in millions)

End of period assets

$

43,364

$

45,141

$

(1,777

)

(3.9

%)

U.S. listed AUM (in millions)

Beginning of period assets

$

40,164

$

51,639

Assets acquired



225

Net inflows/(outflows)

(58

)

(5,359

)

$

5,301

98.9

%

Market appreciation/(depreciation)

1,834

(2,249

)

End of period assets

$

41,940

$

44,256

$

(2,316

)

(5.2

%)

Financial Results (in thousands)

Total revenues

$

54,599

$

60,878

$

(6,279

)

(10.3

%)

Total expenses

39,777

39,206

571

1.5

%

Pre-tax income

$

14,822

$

21,672

$

(6,850

)

(31.6

%)

Net income

$

6,880

$

12,072

$

(5,192

)

(43.0

%)

Our global AUM decreased 3.9% from $45.1 billion at March 31, 2016 to $43.4 billion at
March 31, 2017. This decline was primarily driven by changes in our U.S. listed AUM which decreased 5.2% from $44.3 billion at March 31, 2016 to $41.9 billion at March 31, 2017 primarily due to net outflows from our two
largest funds, HEDJ and DXJ. These net outflows were partly offset by net inflows of $2.1 billion into our U.S. equity ETFs and market appreciation.

We reported pre-tax income of $14.8 million for the three months ended March 31, 2017, a
decrease of 31.6% from the three months ended March 31, 2016 primarily due to lower revenues, and we reported net income of $6.9 million for the three months ended March 31, 2017 compared to $12.1 million for the three months
ended March 31, 2016.

Revenues

Three Months EndedMarch 31,

Change

PercentChange

2017

2016

Global AUM (in millions)

Global - Average AUM

$

42,572

$

46,261

$

(3,689

)

(8.0

%)

U.S. listed AUM (in millions)

U.S. listed - Average AUM

$

41,292

$

45,475

$

(4,183

)

(9.2

%)

U.S. listed - Average ETF advisory fee

0.50

%

0.52

%

(0.02

)

(3.8

%)

Revenues (in thousands)

Advisory fees

$

53,262

$

60,615

$

(7,353

)

(12.1

%)

Other income

1,337

263

1,074

408.4

%

Total revenues

$

54,599

$

60,878

$

(6,279

)

(10.3

%)

Advisory fees

Advisory fees revenues decreased 12.1% from $60.6 million in the three months ended March 31, 2016 to $53.3 million in the
comparable period in 2017 due to declines in our average AUM, primarily in our two largest ETFs and partly offset by $2.1 billion of net inflows into our U.S. equity ETFs and market appreciation. Our average advisory fee for our U.S. listed
ETFs declined from 0.52% for the three months ended March 31, 2016 to 0.50% for the three months ended March 31, 2017 due to changes in product mix.

Other income

Other income increased
408.4% from $0.3 million in the three months ended March 31, 2016 to $1.3 million in the comparable period in 2017. Included within other income for the three months ended March 31, 2017 was a
one-time reimbursement of fund-related costs for prior years of $0.8 million. In addition, other income increased due to higher interest earned on our securities owned, at fair value.

Compensation and benefits expense increased 17.4% from $15.2 million in the three months ended March 31, 2016 to $17.9 million
in the comparable period in 2017 primarily due to higher accrued incentive compensation and other headcount related expenses. Headcount of our U.S. Business segment was 153 and our International Business segment was 38 at March 31, 2016
compared to 163 and 47, respectively, at March 31, 2017.

Fund management and administration

Fund management and administration expense decreased 4.4% from $10.0 million in the three months ended March 31, 2016 to
$9.6 million in the comparable period in 2017. This decrease was primarily due to lower fund costs for our U.S. Business segment attributable to lower average AUM partly offset by the higher number of ETPs and higher average AUM of our
International Business segment. We had 93 U.S. listed ETFs and 79 European ETPs at March 31, 2016 compared to 88 U.S. listed ETFs, 85 ETPs and 6 Canadian listed ETFs at March 31, 2017.

Marketing and advertising

Marketing and
advertising expense decreased 7.7% from $3.8 million in the three months ended March 31, 2016 to $3.5 million in the comparable period in 2017 primarily due to lower levels of marketing related activities.

Sales and business development

Sales and
business development expense increased 21.0% from $2.4 million in the three months ended March 31, 2016 to $3.0 million in the comparable period in 2017 primarily due to higher spending on sales related activities within both our U.S.
Business and International Business segments.

Professional and consulting fees decreased 45.0% from $2.8 million in the three months ended March 31, 2016 to $1.6 million in
the comparable period in 2017 primarily due to lower advisory fees associated with our GreenHaven acquisition which occurred in the first quarter of 2016 as well as lower corporate consulting related expenses.

Occupancy, communications and equipment

Occupancy, communications and equipment expense increased 10.7% from $1.2 million in the three months ended March 31, 2016 to
$1.4 million in the comparable period in 2017 primarily due to higher real estate taxes.

Depreciation and amortization

Depreciation and amortization expense was essentially unchanged from the three months ended March 31, 2016.

Third-party sharing arrangements

Third-party sharing arrangements was essentially unchanged from the three months ended March 31, 2016.

Other

Other expense was essentially
unchanged from the three months ended March 31, 2016.

Income tax

Our effective income tax rate for the three months ended March 31, 2017 of 53.6% resulted in income tax expense of $7.9 million. In
the first quarter of 2017, as required, the Company adopted ASU 2016-09, Compensation  Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting, which
requires companies to record the tax effects related to stock-based compensation within income tax expense, rather than additional paid-in capital, when applicable. Therefore, tax shortfalls (and tax
windfalls) associated with the vesting of stock-based compensation awards are now included within income tax expense. This guidance resulted in the recognition of $1.0 million of income tax expense associated with tax shortfalls recognized upon
vesting of stock-based compensation awards during the quarter. In addition, our tax rate differs from the federal statutory tax rate of 35% primarily due to a valuation allowance on foreign net operating losses and state and local income taxes.

Our effective income tax rate for the three months ended March 31, 2016 of 44.3% resulted in income tax expense of $9,600. Our tax rate
differs from the federal statutory tax rate of 35% primarily due to state and local income taxes, the acquisition payment expense (which is non-deductible) and a valuation allowance on foreign net operating
losses.

The table below presents the net revenues, operating expenses and income before taxes of our U.S. Business and International Business
reportable segments.

Three Months Ended March 31,

2017

2016

(in thousands)

U.S. Business segment

Revenues

$

52,338

$

59,313

Operating expenses

(34,430

)

(35,103

)

Income before taxes

$

17,908

$

24,210

Average assets during the period (in millions)

$

41,292

$

45,475

Average advisory fee during the period

0.50

%

0.52

%

International Business segment

Revenues

$

2,261

$

1,565

Operating expenses

(5,347

)

(4,103

)

Loss before taxes

$

(3,086

)

$

(2,538

)

European ETPs  Average assets during the period (in thousands)

$

704,843

$

428,827

UCITS ETFs  Average asset during the period (in thousands)

$

504,294

$

356,814

Canadian ETFs  Average asset during the period (in thousands)

$

71,242

n/a

European ETPs  Average advisory fee during the period

0.79

%

0.84

%

UCITS ETFs  Average advisory fee during the period

0.43

%

0.47

%

Canadian ETFs  Average advisory fee during the period

0.46

%

n/a

Totals

Revenues

$

54,599

$

60,878

Operating expenses

(39,777

)

(39,206

)

Income before taxes

$

14,822

$

21,672

Three Months Ended March 31, 2017 Compared to Three Months Ended March 31, 2016

U.S. Business segment

Revenues of the U.S. Business segment decreased 11.8% from $59.3 million in the three months ended March 31, 2016 to
$52.3 million in the comparable period in 2017. The decrease was attributable to lower average AUM which decreased 9.2%, primarily due to net outflows from our two largest U.S. listed ETFs, HEDJ and DXJ. These net outflows were partly offset by
net inflows of $2.1 billion into our U.S. Equity ETFs and market appreciation. Our average U.S. advisory fee decreased to 0.50% from 0.52% during the year due to changes in product mix.

Operating expenses of the U.S. Business segment decreased 1.9% from $35.1 million in the three months ended March 31, 2016 to
$34.4 million in the comparable period in 2017. The decrease was primarily attributable to lower fund management and administration expenses due to lower average U.S. listed AUM and lower professional fees primarily a result of lower advisory
fees associated with our GreenHaven acquisition which occurred in the first quarter of 2016. These decreases were partly offset by higher compensation expenses primarily due to higher accrued incentive compensation and other headcount related
expenses. Headcount of our U.S. Business segment was 153 and 163 at March 31, 2016 and 2017, respectively.

International Business
segment

Revenues of the International Business segment increased 44.5% from $1.6 million in the three months ended March 31,
2016 to $2.3 million in the comparable period in 2017. This increase was attributable to higher average AUM which increased 63.0% from $785.6 million in the three months ended March 31, 2016 to $1.3 billion in the comparable
period in 2017 primarily due to net inflows. In addition, in July 2016 we began distributing six locally listed ETFs in Canada.

Operating
expenses of the International Business segment increased 30.3% from $4.1 million in the three months ended March 31, 2016 to $5.3 million in the comparable period in 2017. The increase was primarily due to higher headcount related
compensation expenses. Headcount of our International Business segment was 38 and 47 at March 31, 2016 and 2017, respectively. In addition, fund management and administration expenses increased due to a higher number of ETPs and higher average
AUM. These increases were partly offset by the acquisition payment expense of $0.8 million recorded in the first quarter of 2016 associated with the buyout obligation of the minority interest in our European business which was ultimately
completed during the second quarter of 2016.

The following table summarizes key data regarding our liquidity, capital resources and use of capital to fund our operations:

March 31,2017

December 31,2016

Balance Sheet Data (in thousands):

Cash and cash equivalents

$

79,637

$

92,722

Securities owned, at fair value

57,611

58,907

Securities
held-to-maturity

23,202

22,496

Accounts receivable

19,234

17,668

Total: Liquid assets

179,684

191,793

Less: Total liabilities

(33,569

)

(48,423

)

Total: Available liquidity

$

146,115

$

143,370

Three Months Ended March 31,

2017

2016

Cash Flow Data (in thousands):

Operating cash flows

$

2,447

$

6,777

Investing cash flows

(1,241

)

(11,041

)

Financing cash flows

(14,553

)

(46,393

)

Foreign exchange rate effect

262

348

Decrease in cash and cash equivalents

$

(13,085

)

$

(50,309

)

Liquidity

We consider our available liquidity to be our liquid assets less our liabilities. Liquid assets consist of cash and cash equivalents,
securities owned, at fair value, securities held-to-maturity and accounts receivable. Cash and cash equivalents include cash on hand with financial institutions and all
highly liquid investments with an original maturity of 90 days or less at the time of purchase. Our securities owned, at fair value are highly liquid investments in a portfolio of short-duration investment grade corporate bonds. Certain securities
are accounted for as held-to-maturity securities and we have the intention and ability to hold them to maturity. However, these securities are also readily traded and,
if needed, could be sold for liquidity. Accounts receivable are current assets and primarily represent receivables from advisory fees we earn from our ETPs. Our liabilities consist primarily of payments owed to vendors and third parties in the
normal course of business as well as accrued year end compensation for employees.

Cash and cash equivalents decreased $13.1 million
in the three months ended March 31, 2017 due to $21.3 million used to purchase securities available-for-sale, $10.9 million used to pay dividends on our
common stock, $3.6 million used to repurchase our common stock and $0.7 million used for other activities. These decreases were partly offset by $2.4 million of cash generated by our operating activities and $21.0 million from
sales and maturities of securities available-for-sale.

Cash and cash equivalents decreased $50.3 million in the three months ended March 31, 2016 due to $35.6 million used to
repurchase our common stock, $11.8 million used in connection with the GreenHaven acquisition which occurred on January 1, 2016 and $10.9 million used to pay dividends on our common stock. These decreases were partly offset by
$6.8 million of cash flows generated by our operating activities, $1.1 million from held-to-maturity securities called or maturing during the period and
$0.1 million of other activities.

Capital Resources

Our principal source of financing is our operating cash flow. We believe that current cash flows generated by our operating activities and
existing cash balances should be sufficient for us to fund our operations for at least the next 12 months.

Use of Capital

Our business does not require us to maintain a significant cash position. We expect that our main uses of cash will be to fund the ongoing
operations of our business, invest in strategic growth initiatives, expand our business through strategic acquisitions and fund our capital return program. As part of our capital management, we maintain a capital return program which includes a
$0.08 per share quarterly cash dividend and authority to purchase our common stock through April 27, 2019, including purchases to offset future equity grants made under our equity plans. During the three months ended March 31, 2017, we
repurchased 346,529 shares of our common stock under the repurchase program for an aggregate cost of $3,628. As of March 31, 2017, $92,877 remains under this program for future purchases.

The following table summarizes our future cash payments associated with contractual obligations as of March 31, 2017:

Total

Payments Due by Period

(in thousands)

Less than 1year

1 to 3 years

3 to 5 years

More than 5years

Operating leases

$

36,375

$

3,040

$

6,389

$

8,423

$

18,523

Off-Balance Sheet Arrangements

Other than operating leases, which are included in the table above, we do not have any off-balance
sheet financing or other arrangements. We have neither created nor are party to any special-purpose or off-balance sheet entities for the purpose of raising capital, incurring debt or operating our business.

Critical Accounting Policies

Goodwill and
Intangible Assets

Goodwill is the excess of the fair value of the purchase price over the fair values of the identifiable net
assets at the acquisition date. The Company tests its goodwill for impairment at least annually and at the time of a triggering event requiring re-evaluation, if one were to occur. Goodwill may be impaired
when the estimated fair value of the reporting unit that was allocated the goodwill is less than its carrying value. If the estimated fair value of such reporting unit is less than its carrying value, goodwill impairment is recognized if the implied
fair value of the reporting units goodwill is less than the carrying amount of that goodwill. A reporting unit is an operating segment or a component of an operating segment provided that the component constitutes a business for which discrete
financial information is available and management regularly reviews the operating results of that component.

For impairment testing
purposes, goodwill has been allocated to our U.S. Business reporting unit. When performing our goodwill impairment test, we consider a qualitative assessment, when appropriate, and the income approach, market approach and our market capitalization
when determining the fair value of our reporting units. We have designated April 30th as our annual impairment testing date.

Indefinite-lived intangible assets are tested for impairment at least annually and are reviewed for impairment whenever events or changes in
circumstances indicate that the carrying amount of an asset may not be recoverable. Indefinite-lived intangible assets are impaired if their estimated fair value is less than their carrying value. We may rely on a qualitative assessment when
performing our intangible asset impairment test. Otherwise, the impairment evaluation is performed at the lowest level of identifiable cash flows independent of other assets. We have designated November
30th as our annual impairment testing date for our indefinite-lived intangible assets.

Revenue
Recognition

We earn investment advisory fees from ETPs, as well as licensing fees from third parties. ETP advisory fees are based
on a percentage of the ETPs average daily net assets and recognized over the period the related service is provided. Licensing fees are based on a percentage of the average monthly net assets and recognized over the period the related service
is provided.

Recently Issued Accounting Pronouncements

In June 2016, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2016-13,Financial Instruments-Credit Losses (Topic 326)  Measurement of Credit Losses on Financial Instruments (ASU 2016-13). The main objective of the standard
is to provide financial statement users with more decision-useful information about the expected credit losses on financial instruments and other commitments to extend credit held by a reporting entity at each reporting date. To achieve this
objective, the amendments in the standard replace the incurred loss impairment methodology with a methodology that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information to inform
credit loss estimates. The standard is applicable to loans, accounts receivable, trade receivables, and other financial assets measured at amortized cost, loan commitments and certain other off-balance
sheet credit exposures, debt securities (including those held-to-maturity) and other financial assets measured at fair value through other comprehensive income, and
beneficial interests in securitized financial assets. Accordingly, the new methodology will be utilized when assessing our securities classified as
available-for-sale (AFS) and held-to-maturity for impairment. ASU 2016-13 is effective for years beginning after December 15, 2019, including interim periods within those fiscal years under a modified retrospective approach. Early adoption is permitted for periods beginning
after December 15, 2018. We are currently evaluating the impact that the standard will have on our consolidated financial statements.

In March 2016, the FASB issued ASU 2016-09,CompensationStock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting (ASU 2016-09). The standard is intended to simplify several areas of accounting for share-based
compensation arrangements, including the income tax impact, classification on the statement of cash flows and forfeitures. ASU 2016-09 is effective for fiscal years, and interim periods within those years,
beginning after December 15, 2016, and early adoption is permitted. We adopted this standard prospectively on January 1, 2017. The adoption of the standard increased volatility reported in income tax expense as income tax windfalls and
shortfalls associated with the vesting of stock-based compensation is now recorded in income tax expense, rather than additional paid-in capital, when applicable. This new guidance resulted in us recognizing
approximately $1.0 million of income tax expense for tax shortfalls related to stock-based compensation vesting occurring during this period, which reduced basic and diluted EPS by $0.01. See Notes 11 and 12 to our Consolidated Financial
Statements.

In February 2016, the FASB issued ASU 2016-02,Leases (ASU 2016-02), which requires lessees to include most leases on the balance sheet. ASU 2016-02 is effective for fiscal years (and interim reporting periods within those years)
beginning after December 15, 2018 and early adoption is permitted. We are currently evaluating the impact that the standard will have on our consolidated financial statements. See Note 8 to our Consolidated Financial Statements.

In January 2016, the FASB issued ASU 2016-01,Financial Instruments  Recognition and
Measurement of Financial Assets and Financial Liabilities (ASU 2016-01). The main objective of the standard is to enhance the reporting model for financial instruments to provide users of financial
statements with more decision-useful information. The amendments in the update make targeted improvements to generally accepted accounting principles. These include requiring equity investments (except those accounted for under the equity method of
accounting or those that result in consolidation of the investee) to be measured at fair value with changes in fair value recognized in net income. Available-for-sale
classification for equity investments with readily determinable fair values will no longer be permissible. However, an entity may choose to measure equity investments that do not have readily determinable fair values at cost minus impairment, if
any, plus or minus changes resulting from observable price changes in orderly transactions for the identical or similar investment of the same issuer. The update also simplifies the impairment assessment of equity investments without readily
determinable fair values by requiring a qualitative assessment to identify impairment. When a qualitative assessment indicates that impairment exists, an entity is required to measure the investment at fair value. ASU
2016-01 is effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. Early adoption is not permitted for the updates currently applicable to us.
Our equity investments with readily determinable fair values are all currently measured at fair value with changes in fair value recognized in net income. We will apply the amendments in this update when assessing the carrying value of our
investment, held at cost.

In May 2014, the FASB issued ASU 2014-09,Revenue from Contracts
with Customers (ASU 2014-09), which is a new comprehensive revenue recognition standard on the financial reporting requirements for revenue from contracts entered into with customers. In July 2015, the
FASB deferred this ASUs effective date by one year, to interim and annual periods beginning after December 15, 2017. The deferral allows early adoption at the original effective date. During 2016, the FASB issued ASU 2016-08, which clarifies principal versus agent considerations, ASU 2016-10, which clarifies identifying performance obligations and the licensing implementation guidance, and
ASU 2016-12, which amends certain aspects of the new revenue recognition standard pursuant to ASU 2014-09. ASU 2014-09 allows for
the use of either the retrospective or modified retrospective adoption method. We are currently reviewing our contracts in order to evaluate the impact that the standard will have on our consolidated financial statements.

The following information, together with information included in other parts of this Managements Discussion and Analysis of Financial
Condition and Results of Operations, describes key aspects of our market risk.

Market Risk

Market risk to us generally represents the risk of changes in the value of securities held in the portfolios of the WisdomTree ETPs that
generally results from fluctuations in securities prices, foreign currency exchange rates against the U.S. dollar, and interest rates. Nearly all of our revenues are derived from advisory agreements for the WisdomTree ETFs. Under these agreements,
the advisory fee we receive is based on the average market value of the assets in the WisdomTree ETF portfolios we manage.

Fluctuations
in the value of these securities are common and are generated by numerous factors such as market volatility, the overall economy, inflation, changes in investor strategies and sentiment, availability of alternative investment vehicles, government
regulations and others. Accordingly, changes in any one or a combination of these factors may reduce the value of investment securities and, in turn, the underlying AUM on which our revenues are earned. These declines may cause investors to withdraw
funds from our ETPs in favor of investments that they perceive as offering greater opportunity or lower risk, thereby compounding the impact on our revenues. We believe challenging and volatile market conditions will continue to be present in
the foreseeable future.

Interest Rate Risk

In order to maximize yields, we invest our corporate cash in short-term interest earning assets, primarily money market instruments at a
commercial bank, federal agency debt instruments and short-term investment grade corporate bonds which totaled $135.7 million and $120.3 million as of December 31, 2016 and March 31, 2017, respectively. We do not anticipate that
changes in interest rates will have a material impact on our financial condition, operating results or cash flows.

Exchange Rate Risk

As a result of our operations in Europe, Japan and Canada, we now operate globally and are subject to currency translation exposure on the
results of our non-U.S. operations. Foreign currency translation risk is the risk that exchange rate gains or losses arise from translating foreign entities statements of earnings and balance sheets from
functional currency to our reporting currency (the U.S. dollar) for consolidation purposes. We generate the vast majority of our revenues and expenses in the U.S. dollar and expect to do so for some time. We do not anticipate that changes in
exchange rates, predominantly the British pound or Euro, and to a lesser extent, the Japanese Yen and Canadian Dollar, as they relate to translating functional currency to our reporting currency, will have a material impact on our financial
condition, operating results or cash flows. Currently, we do not enter into derivative financial instruments aimed at offsetting certain exposures in the statement of operations or the balance sheet but may look to do so in the future.

ITEM 4. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

As of March 31, 2017, our management, with the participation of our Chief Executive Officer and our Chief Financial Officer, evaluated the
effectiveness of our disclosure controls and procedures pursuant to Rule 13a-15(b) promulgated under the Securities Exchange Act of 1934, as amended, or the Exchange Act. Based upon that evaluation, our Chief
Executive Officer and our Chief Financial Officer concluded that, as of March 31, 2017, our disclosure controls and procedures were effective at a reasonable assurance level in ensuring that material information required to be disclosed by us
in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the rules, regulations and forms of the SEC, including ensuring that such material information is
accumulated by and communicated to our management, including our Chief Executive Officer and our Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure.

Changes in Internal Control over Financial Reporting

During the quarter ended March 31, 2017, there were no changes in our internal control over financial reporting that have materially
affected, or are reasonably likely to materially affect, our internal control over financial reporting.

You should carefully consider the information set forth in this Report, as well as the information set forth in Part 1,
Item 1A. Risk Factors in our Annual Report on Form 10-K for the fiscal year ended December 31, 2016.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

Recent sales of Unregistered Securities

None.

Use of Proceeds

Not applicable.

Purchases of Equity
Securities by the Issuer and Affiliated Purchasers

The following table provides information with respect to purchases made by or on
behalf of the Company or any affiliated purchaser of shares of the Companys common stock.

Total Numberof SharesPurchased

Average PricePaid Per Share

Total
Number ofShares PurchasedasPart of PubliclyAnnounced PlansorPrograms(1)

On October 29, 2014, our Board of Directors authorized a three-year share repurchase program of up to $100.0 million. On April 27, 2016, the Board approved a $60.0 million increase to this program
and extended the term through April 27, 2019, increasing the total authorized repurchase amount to $100.3 million. During the three months ended March 31, 2017, we repurchased 346,529 shares of our common stock under this program for
an aggregate cost of $3.6 million. As of March 31, 2017, $92.9
million remained under this program for future purchases.

Amended and Restated Certificate of Incorporation (incorporated by reference to Exhibit 3.1 of the Registrants Registration
Statement on Form 10, filed with the SEC on March 31, 2011)

3.2

Amended and Restated Bylaws (incorporated by reference to Exhibit 3.2 of the Registrants Registration Statement on Form 10, filed
with the SEC on March 31, 2011)

4.1

Specimen Common Stock Certificate (incorporated by reference to Exhibit 4.1 of the Registrants Registration Statement on Form 10,
filed with the SEC on March 31, 2011)

4.2

Amended and Restated Stockholders Agreement among Registrant and certain investors dated December
21, 2006 (incorporated by reference to Exhibit 4.2 of the Registrants Registration Statement on Form 10, filed with the SEC on March 31,
2011)

4.3

Securities Purchase Agreement among Registrant and certain investors dated December 21, 2006 (incorporated by reference to Exhibit
4.3 of the Registrants Registration Statement on Form 10, filed with the SEC on March 31, 2011)

4.4

Securities Purchase Agreement among Registrant and certain investors dated October 15, 2009 (incorporated by reference to Exhibit
4.4 of the Registrants Registration Statement on Form 10, filed with the SEC on March 31, 2011)

4.5

Third Amended and Restated Registration Rights Agreement dated October 15, 2009 (incorporated by reference to Exhibit 4.5 of the
Registrants Registration Statement on Form 10, filed with the SEC on March 31, 2011)

10.1(1)

Form of Amendment, dated May 5, 2017, to Form of Employment Agreement for Executive Officers, dated December
22, 2016 (incorporated by reference to Exhibit 10.1 of the Registrants Current Report on Form 8-K, filed with the SEC on December 23,
2016)

Financial Statements from the Quarterly Report on Form 10-Q of the Company for the quarter ended March 31, 2017, formatted in XBRL: (i) Consolidated Balance Sheets;
(ii) Consolidated Statements of Operations and Comprehensive Income (Unaudited); (iii) Consolidated Statements of Cash Flows (Unaudited); and (iv) Notes to Consolidated Financial Statements, as blocks of text and in detail.

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this Report to be signed on its behalf by
the undersigned thereunto duly authorized on this 8th day of May 2017.

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